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Unifrax plans to spend about $116 million to acquire a 29 percent ownership stake in a Chinese company, Shandong Luyang Share Co. Ltd.

The transaction is expected to close later this year. Once completed, Town of Tonawanda-based Unifrax will be the largest shareholder in Luyang. The deal still needs to complete several steps, including approvals from the Chinese government and Luyang shareholders, said Virginia Cantara, a Unifrax spokeswoman.

Unifrax makes specialty fiber products used in high-temperature industrial, automotive and fire protection applications. Luyang makes and sells refractory and insulation materials used primarily in China.

Under a licensing agreement, Luyang will be allowed to use certain Unifrax manufacturing technology, and Unifrax will become the exclusive distributor of Luyang products in North America, South America, Europe and India.

David Brooks, Unifrax’s president and chief executive officer, said in statement that Luyang’s founder and leadership team “have built strong relationships with their customers and invested substantial capital to ensure they have the capacity and capabilities needed to consistently meet their customers’ requirements.”

Unifrax is majority owned by affiliates of New York City-based American Securities LLC. Worldwide, Unifrax has 2,200 employees and 28 manufacturing facilities. About 395 of those employees are in Western New York, at Unifrax’s corporate headquarters and its manufacturing facilities in Tonawanda and Sanborn.

email: mglynn@buffnews.com